Lyla's parents came to Korvosa when she was still a little child, as part of a large influx of halfling sailors hired to work for the various local noble houses. When the family settled, it was decided that her father would work in the docks and in the boats, while her mother was to stay home and look after their four children. That is basically all Lyla remembers of her life before she parted ways with her family - thanks to the mischievous schemes of Gaedren Lamm.
It was a winter afternoon when the family went to see the arrival of a merchant fleet tripulated mainly by halflings, and Lyla's father was one of the sailors coming back to spend a few days home. Her mother and siblings were terribly excited to see him again, as were the children and wives of many other families gathered there.
Lamm' lackeys used to prowl on the docks back then, and found that the place could get quite crowded from time to time. The arrival of the ships was just such an occasion. As the vessels approached, the giggles and shouts of excitement were replaced by panic and terrifed screams after Lamm' gang started running around the place, knives in hands, grabbing people's belongings - be they purses or children. In the tumult that followed, Lyla lost the grip on her mother's hand and was dragged by the crowd, until someone picked her up and threw her in a sac. When the girl was let out of the bag, she was in an shady warehouse along other kids. Little Lamms, the adults called them.
From then on, Lyla was forced to perform all kinds of criminal duties for the gang. As she grew older, her tasks also escalated: she began wrapping shiver doses to be sold on the street, chained to a desk; then, after growing up a little, she was told to watch out for city guard patrols, passing out warnings to the gang; it wasn't long before she took up on going back and forth resupplying the dealers, and in no time she became a dealer herself. Needless to say, such life was never to her liking, but refusals and mistakes were severely punished. She feared Lamm so much that she could not bring herself to say no - until she did. When, aged 13, Lyla decided to not deal drugs anymore, Lamm was displeased. The girl received a harsh beating and spent days locked in a dark, damp room without food or water. When she came out, Lamm told her her wish had come true: she would not be going to the streets anymore. Instead, Lyla was sent to work in a laboratory to produce the drug; it was as bad as the streets, though: the man in charge was brutal, and she was never allowed to leave the laboratory, where she spent the nights locked away.
Being quite a smart girl, Lyla made the most out of her situation, observing carefully the alchemical processes conducted in their experiments and quickly learning the alchemy craft. She soon found out how to pick the locks of her chains and door, sneaking out at night to use the empty lab for studies of her own. After a couple of years working there, she decided it was time to escape: she prepared an explosive mixture and tried to blow the whole thing up; however, she was barely through the door when Lamm's men caught her. This time, Lamm was not going to let her off the hook. She was beat up badly, and left for dead by some of the gang members, who assured Gaedren Lamm that the girl was a goner.
She would probably have been, though, had they not left her in an alleyway right at the doorsteps of an old human healer in the Shingles. Her name was Althea, and the lonely woman took the girl in and tended to her injuries for weeks before Lyla was well again. The two formed a close bond, and even more so after Lyla tried to find her family only to find out that there was no sign of them anywhere in Korvosa - not after ten years. Truth be told, Lyla did not have much of a starting point anyway, since she did not remember her family name, nor her parents', whom she had only known by 'mom' and 'dad'.
For the past few years, Lyla has been living with Althea in the Shingles, helping the old woman craft elixirs, ointments and other infusions for sale. She helps the house anyway she can, which means she is not beyond picking a few wealthy pockets here and there. She generally tries to stay out of Lamm's way, and since she knows the faces of many of his men, has been fairly successful in that regard; as far as she knows, Lamm does not imagine she is alive. Yet, the girl pities the other kids still under his domain, and often finds herself dreaming of the day she can bring the bastard down.